The state’s Board of Public Utilities mentioned Tuesday that New Jersey and Orsted have settled claims in opposition to one another stemming from the corporate’s resolution final October to scrap two wind farms off the state’s southern coast.
The state mentioned the $125 million it’ll obtain shall be used to assist investments in wind vitality services, element manufacturing services, and different clear vitality applications.
Earlier than the tasks have been deserted, Orsted put up a $100 million assure that it will have one in all them, Ocean Wind I, constructed by the top of 2025. It additionally had been obligated to pay an extra $200 million towards the event of the offshore wind business in New Jersey.
Per week after scrapping the tasks final fall, Orsted mentioned it was attempting to get out of the $300 million price of ensures as a result of it was not pursuing the tasks.
Orsted, in an announcement to The Related Press, mentioned it’s “pleased” with the settlement, which it mentioned represents the corporate’s whole monetary obligation to the state.
The settlement, together with different strikes introduced Tuesday by New Jersey, “underscore New Jersey’s commitment to offshore wind and the industry’s bright future in the Garden State,” it mentioned.
“While we advance clean energy projects throughout the region, we look forward to continuing valuable partnerships with New Jersey stakeholders,” the assertion learn.
The corporate wouldn’t say if it plans to suggest future tasks in New Jersey.
However Jeff Tittel, a longtime environmentalist and retired president of the New Jersey Sierra Membership, known as the settlement with Orsted “a sellout.”
“The governor said they would be held responsible for the entire $300 million they owe the state for their failed project,” he mentioned. “They are being let off the hook, paying less than half, with New Jersey losing $175 million. This is a bad deal for New Jersey.”
The settlement announcement was one in all a number of that the administration of Democratic Gov. Phil Murphy made Tuesday relating to offshore wind.
The state mentioned it’s shifting up the following solicitation for added offshore wind tasks from the third quarter of 2026 to the second quarter of 2025. New Jersey’s present spherical of solicitations closes on July 10.
The state additionally mentioned it’s pausing plans to coordinate energy transmission planning for offshore wind tasks with the regional grid operator, PJM Interconnection resulting from a brand new rule by federal vitality regulators that would have an effect on planning and prices.
“Offshore wind development remains a once-in-a-generation opportunity that will result in significant economic and environmental benefits throughout the Garden State,” Murphy mentioned in an announcement. “At this pivotal inflection point for the industry both in New Jersey and across the nation, it’s critical that we remain committed to delivering on the promise of thousands of family-sustaining, union jobs and cleaner air for generations to come.”
Orsted wrote off $4 billion final fall, due largely to prices related to the cancellation of its two New Jersey tasks. The corporate cited provide chain points, inflation and a failure to realize sufficient authorities tax credit.
There are at the moment three preliminarily accepted offshore wind tasks in New Jersey.
The state is dwelling to vociferous opposition to offshore wind by quite a few teams who say the tasks are too expensive and are probably dangerous to the marine surroundings.
Defend Our Coast NJ mentioned the transfer to speed up offshore wind contracts “reflects the shifting political landscape in Washington and in New Jersey,” calling Murphy’s clear vitality targets “arbitrary and unrealistic.”
Supporters say they’re an essential approach to transfer away from the burning of fossil gas that contributes to local weather change.
